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Bold Boomer Series: Innovative Solutions for Tackling Healthcare Expenses in Retirement

(Editor’s note: Welcome to the first installment of the Bold Boomer Series, which will delve into various topics affecting the “Baby Boomer” generation.)

It is often said that those who are the true wealthiest are those who have their health. This saying has a great deal of merit, especially when it comes to retirement. It’s not uncommon to hear about someone entering retirement with tremendous anticipation, only to be diagnosed with a health-limiting condition. In these instances, adjustments must be made and a new perspective taken. But if a person has neglected planning for healthcare costs in these situations, options may be quite limited. And even for those who do anticipate such costs, accurate financial guidance may be difficult to find.

For employees at major firms with healthcare benefits, resources may exist to assist with the future planning for healthcare costs. But such supports are often not routinely available for entrepreneurs and those working for small businesses. Similarly, with many people preferring to work at home as contractors, good information may be even more challenging to find. Fortunately, this may soon be changing as innovative technologies could potentially provide a solution to this problem. Rather than guess how much healthcare expenses in retirement may be, data-backed insights could offer a much more precise answer.

(It’s not to check out Bold Business’ survey and analysis of the general public’s preferred method of work!)

“The [healthcare in retirement] budget begins to incorporate what we anticipate the care needs will be. I compare it to a wedding. There are a thousand little expenses that add up and that Medicare doesn’t cover.” – James Sullivan, Certified Public Accountant, Fairhaven Wealth Management

A Complex and Complicated Situation

In general, it’s not surprising that healthcare expenses in retirement are substantial. Many illnesses become increasingly more common as we age. This is especially true for chronic diseases like Alzheimer’s dementia, Parkinson’s disease, stroke, and heart disease. But effective planning for healthcare costs demands much more than a reasonable understanding of these conditions. Not only do medications and treatments constantly change in type but in price as well. At a minimum, retirees-to-be must somehow predict how these conditions will evolve over time. And this is extremely difficult without access to the right tools and information.

There are additional considerations besides disease progression and changes in treatment when it comes to healthcare expenses in retirement. Older adults are also reimagining what aging means. In the U.S., the retirement age is now averaging closer to 62 years of age. Likewise, Americans are also living longer, which means retirees will need larger savings accounts. Since healthcare costs consume about 15 percent of all retirement expenditures, a few extra years can be noteworthy. Combine this with healthcare price increases that continue to outpace inflation, accurate planning for healthcare costs demands expertise. For most individuals, this type of financial planning guidance doesn’t exist.

“Many people assume Medicare will cover all your health care cost in retirement, but it doesn’t. We estimate that about 15% of the average retiree’s annual expenses will be used for health care-related expenses.” – Steve Feinschreiber, SVP, Financial Solutions Group, Fidelity

Traditional Areas of Financial Planning Support

For most people planning for healthcare costs in retirement, there are several traditional strategies that might be used. Common resources routinely involve financial planners, their medical providers, and even advocacy groups. Some may even seek out geriatric care managers for a more detailed assessment of their retirement planning needs. Based on this type of advice, a savings plan is created and followed with the hopes it will be satisfactory. But more often than not, these projections may fall short. In other words, it’s not a lack of planning for healthcare costs that’s the problem. It’s the lack of solid data and information to determine the right approach.

Recent data suggests a couple retiring at age 65 years will need about $300,000 for healthcare expenses in retirement. Assuming such a couple has Medicare, then the bulk of these goes toward copays and deductibles. Most of the remainder then goes to pay for medications and specialized equipment. But these estimates fail to anticipate other costs such as those related to caregivers and long-term care. Recent projections suggest that more than two-thirds of older adults may require such care. Unfortunately, traditional planning for healthcare costs in older age tends to underestimate these needs. And this can pose serious problems down the road.

“[The healthcare planning] burden unfortunately gets placed on the consumer. Every day we hear about rising healthcare costs and medical bankruptcy, and I’m so excited that we’re empowering consumers to proactively plan for the costs and make smarter decisions using data.” – Christine Simone, Cofounder of Caribou

Technology to the Rescue

Given the current state of affairs, innovative solutions related to retirement planning for healthcare costs are needed. Fortunately, one startup hopes to address this issue by targeting those most involved in the planning process…financial planners. Caribou Wealth, a Miami-based startup, has already raised $3.1 million in venture capital funding. Its SaaS model provides financial planners with healthcare cost predictions through optimization software. Data concerning healthcare utilization, illnesses, medications, treatments and other insights serve as the primary inputs. Then, the software provides detailed projections that better estimate healthcare expenses in retirement.

A bunch of pills and money
Planning for healthcare costs into retirement is a tricky prospect–one that requires innovative solutions.

The software service that Caribou can offer financial advisors and planners could greatly improve the advice they provide. It’s therefore not surprising that the startup already has dozens of clients. Combined, these clients represent tens of thousands of individuals who are planning for healthcare costs in the future. This means the impact Caribou is tremendous despite the company being relatively new. Plus, while their current platform is geared toward financial experts, future versions hope to target consumers directly. Specifically, the cofounders plan to further develop their product as plug-ins for financial planning sites online. This would in essence enable individuals to determine their own healthcare expenses in retirement.

An Important Part of the Healthcare Puzzle

When it comes to the healthcare sector, a variety of solutions are needed to control expenditures. This includes shifting efforts toward health promotion and disease prevention. It also will require new healthcare service models that are more efficient and cost-effective. But without question, technology will play an increasing role in these efforts, and so will healthcare data. Understanding this, it’s not surprising that technology related to planning for healthcare costs might also be a needed pursuit. By better predicant healthcare expenses in retirement, individuals can better prepare for later life. And hopefully, maximize their quality of living during these golden years.

 

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No More Lockdowns: What a Post-Pandemic World Means for Businesses That Thrived

When the pandemic struck, the impact on many businesses were profound. The travel and tourism industry felt the immediate effects of lockdowns and quarantines. The same was true of restaurants, bars, and various hospitality services. But not every sector suffered the same consequences, and in fact, many specific industries actually thrived. While the pandemic posed serious threats to some, it was a blessing to others from an economic perspective. But as we move ever so closer to a post-pandemic world, will these same businesses continue to excel? Or could there be a new post-pandemic normal that requires them to face a new reality?

In recent months, several developments suggest many businesses that soared during COVID may be facing some rocky times ahead. While consumer behaviors changed during lockdowns, these same preferences may not last. As a result, businesses that believed a post-pandemic world might mirror a pandemic one may have to reconsider their perspective. Those that are willing to adapt, and do so rapidly, are among those likely to survive. But for those that fail to properly assess a new post-pandemic normal, the results may be less favorable. In other words, the pandemic giveth, and the post-pandemic may taketh away.

“The soaring stock prices that peaked for so many specialized companies amid the worst of the pandemic were never poised to have stuck around.” – Chase Hinderstein, Senior Portfolio Manager, Wise Investor Group at Baird

The Winners During the Pandemic

As COVID-19 spread across the globe, naturally consumers reacted to the changing times. Lockdowns and curfews meant physical access was much more limited. As a result, consumers increasingly turned to online and delivery options instead of in-person consumption. Likewise, the threat of infection and illness fueled these trends further. And as new variants of COVID emerged, the possibility of a post-pandemic world seemed like a fantasy instead of a reality. This resulted in some expected business winners over the course of the last two years. And several believed pandemic consumer behaviors would extend into a new post-pandemic world.

A group of people chilling at work
A post-pandemic world means further upheaval–especially for businesses that thrived during the lockdowns.

With this in mind, a number of specific industries grew rapidly during the first year of the pandemic. Companies involved in sanitizing and cleaning naturally saw a boom in sales. Likewise, health and virtual fitness enterprises saw consumers flock toward their services as gyms closed and group fitness activities ceased. (Dive deeper into the rise of the virtual fitness industry in this Bold story.) And most noticeably, streaming entertainment services and delivery companies saw their clientele increase exponentially. But these same companies today are no longer seeing such growth as we inch close to a post-pandemic world. And many suggest their success may be much more limited as the dust of a new post-pandemic normal settles.

“The ones that jumped out in the initial leap because they had the infrastructure ready to go are now losing a little market share as the other companies ramp up and catch up in those spaces.” – David Sacco, University of New Haven Finance Department

A Glimpse of the New Post-Pandemic Normal

Despite Omicron and Delta, there have been some notable shifts in recent months. With the COVID vaccines and booster, many states are much more open. Lockdowns have vanished, and even mask requirements are less strict. With these changes have come some significant changes in company valuations and sales. And by all accounts, it looks like a post-pandemic world will be much different than what many businesses believe. Here’s a look at some of the most recent business developments that highlight this point.

  • Peloton – In 2019, prior to the pandemic, Peloton had a little more than $700 million in sales. But in 2020, sales reached $1.8 billion, and in 2021, exceeded $4 billion. Given these figures, the company invested heavily in its high-tech bicycles, assuming the good times would last. But now that gyms have reopened and consumers have other options, Peloton has experienced a serious decline. In December alone, Peloton’s share price fell 80% as a shift to post-pandemic world has occurred. And while product recalls and bad publicity have played a role, its main downfall has been excessive inventory. Based on this, it’s quite unlikely Peloton will thrive in a new post-pandemic normal.
  • Netflix – As millions were stuck inside their homes during lockdowns, it was easy to predict Netflix’s success. Inexpensive entertainment and a captive audience provide great recipe ingredients of success for the online streaming giant. But it too appears to now be struggling in a post-pandemic world. This past year, Netflix enjoyed 222 million subscribers. But while this seems noteworthy, the figure represents its lowest totals since 2015. Combine this with a decline in its stock price by 20%, and it’s understandable why investors are concerned. The new post-pandemic normal may similarly be unkind to Netflix without some major changes.
  • Zoom – Believe it or not, Zoom’s share price before the pandemic was roughly $70 a share. But over the ensuing year, the company’s valuation grew by 700%. With telehealth demands and remote videoconferencing on the rise, Zoom was an obvious choice. The company was well-positioned to take full advantage of consumer shifts. But despite many workers insisting on remote work, Zoom’s stock has plummeted. Today, it hovers around $150 a share, which is markedly less than it was at its peak. In a post-pandemic world, the demand for videoconferencing will be less than it was. And more importantly for Zoom, the new post-pandemic normal will include many quality competitors.

One Thing the Pandemic Didn’t Change

Dealing with the effects of a global pandemic isn’t easy, and companies that excelled during this time deserve recognition. But one thing common to both a pre-pandemic and post-pandemic world is the need for businesses to be adaptable. Many companies found that they had to be dynamic and flexible to survive over the last couple of years. And this will remain true for businesses as they enter into a new post-pandemic world. Some, like the ones mentioned here, are finding it difficult to adapt quickly enough. But once again, those that find a way will be the ones best positioned for future success. Most likely, the new post-pandemic normal will be a hybrid model, representing a mix of old and new consumer preferences. It will be important for all businesses to figure this out so they can best translate this shift into ongoing success.

 

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Is a Cure for HIV on the Horizon?

For more than three decades, the world has been dealing with the Human Immunodeficiency Virus, better known as HIV. Current statistics show that more than 38 million people have active HIV infections. Also, since the 1980s, more than 36 million have died as a result of AIDS and its complications. Today, there are new HIV treatments that can be used to keep the virus in check. However, an actual cure for HIV remains elusive due to the inherent nature of the virus’ behavior. But based on recent research, this may soon change in the near future as scientists discover new insights.

In the last few years, researchers have revealed additional clues concerning how the HIV virus escapes eradication. While new HIV treatments are effective in preventing the virus from replicating, these do little to rid the body of it. For this reason, different strategies are needed if scientists hope to find a cure for HIV. Fortunately, the most recent investigations suggest precisely the type of approach that might be required. And if newer agents can be developed in this regard, there is significant reason for optimism. Despite being years away, we may be seeing the beginning of the end when it comes to HIV.

(Read more about the various innovations in HIV treatment drugs in this Bold story.)

“Increasing evidence suggests that durable drug-free control of HIV-1 replication is enabled by effective cellular immune responses.” – Dr. Xiaodong Lian, Post-doctoral Research Fellow, Ragon Institute of MGH, MIT and Harvard

Understanding HIV’s Unique Behaviors

In regards to causing infection, HIV is a retrovirus that specifically targets and infect immune cells in the body. If untreated, these immune cells gradually decline and die, resulting in increasing susceptibility to infections and cancers. In the last couple of decades, however, anti-retroviral therapies (ART) have been developed. These new HIV treatments prevent the HIV virus from spreading and from being active. But this is only one piece of the puzzle. It’s also a reason ART drugs do not represent a cure for HIV.

The issue with the HIV virus is that it persists in a dormant state within the cells it infects. While ART drugs keep it in check, it is unable to eradicate it from these cells. In fact, the HIV virus hides itself within immune cells’ chromosomes and waits for an opportunity to return. Therefore, when patients stop taking their ART drugs, the HIV becomes active all over again. Finding new HIV treatments that address this unique feature of HIV has been frustrating for researchers. But new approaches suggest that a cure for HIV may be in sight. This is because new HIV treatments that seek out these latent HIV viruses may soon be around the corner.

The Success of “Kick and Kill” Strategies

Understanding that HIV can lie dormant in a person’s body, scientists have long realized virus reactivation might be required. In order for a person’s immune system or medication to destroy the virus, it must be brought out into the open. Only then will it be possible to eliminate all HIV viral particles in the body. Therefore, investigations into new HIV treatments have recently been exploring what is known as a “kick and kill” approach. One drug “kicks” the latent virus out of hiding into an activated state. Then, another drug “kills” it permanently, hopefully eradicating it completely. If such an approach is comprehensive, then it would offer a cure for HIV once and for all. This is the area where current research investigations have invested their efforts as of late.

The most recent research in this regard was conducted at UCLA. In the study, scientists administered a combination “kick and kill” therapy to mice with HIV currently on ART. One drug, which was named SUW133, forced latent HIV viruses our of hiding. Then, the second treatment involved administration of mouse Natural Killer immune cells that destroyed the HIV virus. The results of their investigation found that 40% of the mice no longer harbored any HIV virus cells at all. Thus, they concluded that these types of new HIV treatments could indeed offer an eventual cure for HIV.

“These findings show proof-of-concept for a therapeutic strategy to potentially eliminate HIV from the body, a task that had been nearly insurmountable for many years,” The study opens a new paradigm for a possible HIV cure in the future.” – Jocelyn Kim, Assistant Clinical Professor in Health Sciences, UCLA

Proactive Versus Retroactive Treatments

With millions of individuals actively infected with HIV, a cure for HIV is naturally important. New HIV treatments that can further refine a kick and kill approach in humans will be needed regardless. But as is usually the case, prevention remains the best and most cost-effective strategy. In this regard, such HIV prevention therapies already exist, including HIV vaccines. Other agents can be taken on a regular basis to prevent infection, and still others can be taken shortly after a potential exposure. And still others can be taken by HIV infected individuals to prevent further spread. These therapies are called PreP, PeP and TasP, respectively.

A bunch of blood samples in test tubes
New HIV treatments abound–can a cure be much farther away?

PreP stands for Pre-exposure Prophylaxis while PeP is an acronym for Post-exposure Prophylaxis. TasP is short for Treatment as Prevention. Of these options, PreP is the most effective, preventing 99% of sexually transmitted HIV infections. Each of these new HIV treatments are designed for those at high-risk for acquiring HIV. But despite their efficacy and FDA-approved status, fewer than a quarter of at-risk individuals use them. HIV stigma, cost, lack of insurance coverage, and poor access to information account for this low rate of use. At the same time, these statistics show why a cure for HIV remains an important long-term goal.

Hope for an HIV-Free Future

The current research described notably involve mice infected with HIV. Therefore, the safety and effectiveness of these kick and kill therapies has only been assessed in animal research. Likewise, while this looked to be a cure for HIV in 40 percent of the mice, 60 percent had an incomplete response. All of this implies that additional research is needed before these types of new HIV treatments will be available. Regardless, these findings offer hope that a cure for HIV may not be too far away. And for millions of people who actively have the disease, this is great news.

 

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